Riaz Haq writes this data-driven blog to provide information, express his opinions and make comments on many topics. Subjects include personal activities, education, South Asia, South Asian community, regional and international affairs and US politics to financial markets. For investors interested in South Asia, Riaz has another blog called South Asia Investor at http://southasiainvestor.blogspot.com and a YouTube video channel https://www.youtube.com/channel/UCkrIDyFbC9N9evXYb9cA_gQ

Monday, June 10, 2013

Pakistan has made remarkable progress in electrification of its towns and villages both in absolute terms and as percentage of population over the past two decades, according to a recently-released report titled "Global Tracking Framework" issued jointly by the World Bank and the International Energy Agency. This report at least partly explains the dramatic increase in demand-supply gap and consequent increase in load-shedding in Pakistan.

The report says that 60 percent of Pakistanis had access to electricity in 1990, 80 percent in 2000 and 91 percent in 2010. By 2010, 88 percent people of rural and 98 percent of the country's urban population had access to electricity. Comparable figures in India are as follows: 51% in 1990, 62% 2000, and 75% in 2010. 93% of urban and 67% of rural Indians had access to electricity in 2010.

The report identifies top 20 countries with the largest number of people to have gained access to electricity over the past 20 years. Of these, 12 are in Asia. They brought electrical service to 1.3 billion people (of the 1.7 billion electrified globally between 1990 and 2010), 283 million more than their population increase. The most impressive expansion of electrification occurred in India, China, Indonesia, Pakistan and Bangladesh. The advances in these populous countries are of enormous significance for achievement of the global universal access target.

In addition to access to electricity, the report also details access to non-solid fuels like oil and natural gas (fuels other than firewood, dung or charcoal commonly used in poor countries for cooking) as a key parameter of progress in terms of energy. Such access helps reduce environmental pollution and associated human health hazards.

The goal of universal access to modern energy depends critically on the efforts of 20 high-impact countries which include Bangladesh, China, India and Pakistan. Together, these 20 countries account for more than two thirds of the population currently living without electricity (0.9 billion people) and more than four-fifths of the global population without access to non-solid fuels (2.4 billion people). In terms of electricity, India has by far the largest access deficit; exceeding 300 million people, while for non-solid cooking fuel, India and China each have access deficits exceeding 600 million people.

This tracking report is part of UN's Sustainable Energy For All (SE4ALL) Initiative launched in 2012. The initiative recognizes the importance of universal access to modern energy as a key part of empowering the poor and lifting large numbers of people out of poverty and deprivation.

For the newly-connected rural poor in Pakistan, even a couple of hours of electricity a day is better than no electricity all. Even a brief period of service enables them to charge up their cell phones and watch a little bit of television to stay informed and connected.These small things significantly improve the quality of life of those who lived without any electrical connections in the last decade or two. Eventually one hopes that the energy crisis will be resolved to bring supply and demand in better balance.

HWJ: "Sharif/Bhutto's merry-go-round beat India's performance by 20-to-11 in the 1990s. Military rule was beated by India in the 2000s.

Well? ARE YOU going to give credit to our DEMOCRACY of the 1990s or not?"

There several possible explanations:

First, it probably has something to do with low-hanging fruit picked first. For example, people living closer to the national grid being added in 1990s and the job getting more difficult later in 2000s to add those living in more remote areas.

Second, the politicians often do things to gain quick popularity by doing things like giving service connections for elect and gas that create other serious problems such as increasing load-shedding for existing consumers.

HWJ: "It was the long-term investments made during Bhutto-Sharif's merry-go-round that paid off during Mushy's consumption boom from 2003-2007."

Almost all of the capacity in 1990s was added by Benazir Bhutto's govt, not Nawaz Sharif's.

Now it's become the source of the current unprecedented electricity crisis.

Pakistan's installed generating capacity is about 20,000 MW. It exceeds current demand of 17,000 MW and actual supply of just 10,000 MW. The capacity utilization is only 50% mainly because the producers do not buy sufficient fuel and choose to operate at only 50% of capacity and still enjoy soaring profits. A third of the installed generating capacity is owned by the independent power producers (IPPs). The current IPP contracts guarantee payments and profits with no requirement for fuel efficiency.

Most private investors (IPPs) built oil-powered inefficient plants because of their low construction costs and short lead times, and the oil price has skyrocketed since these plants were built in 1990s. The result is 18-20 hours of load shedding across most of Pakistan in the scorching summer heat in spite of the fact the taxpayers have shelled out billions of dollars in subsidies to the power sector since 2008.

Pakistan says it can't let geopolitical concerns interfere with its quest to find ways to keep the lights on. A planning minister said last weekend that all options must be on the table to resolve ongoing energy woes and that could include actually moving on a long-discussed natural gas pipeline from Iran. A rival project from Turkmenistan has U.S. and Asian Development Bank support, though with U.S. priorities shifting, the new Pakistani government may have greater freedom in terms of its regional social circles.

The U.S. government last week tightened the screws on the Iranian energy sector on the heels of a damning report from the International Atomic Energy Agency. U.S. sanctions are meant to starve Iran of the revenue it could use to finance its controversial nuclear program and, to some extent, the U.S. efforts are working better than ever.

Nawaz Sharif is in the dawn of his third stint as prime minister of Pakistan. His third non-consecutive term marks the first time that a civilian government ended a full five-year term and handed power over to another administration by a democratic vote. Last week, he told members of Parliament the day of U.S. drone strikes over Pakistani territory are over.

"We respect the sovereignty of other countries, but others should also respect our sovereignty," he said.

U.S. President Barack Obama told the National Defense University last month that patience should drive foreign policy as it relates to developing democracies like Pakistan's. With Sharif's administration in power, and the war in Afghanistan winding down, it's time to shift U.S. focus to new and emerging threats. The core of al-Qaida is on the path to defeat, the president said, and operations like the raid that killed Osama bin Laden in 2011 can no longer be the norm. That means that no longer can U.S. policy drive the terms of a democratic Pakistan. When a U.S. drone strike left at least nine people dead in Pakistan last week, it was Sharif's government calling the shots by issuing a formal complaint against the attack.

Pakistani Federal Minister for Planning Ahsan Iqbal said the government needs to ensure natural gas supplies from wherever they come from. The top priority for Sharif's administration isn't making friends, but keeping the lights on, he said. Pakistan's national security is compounded by domestic frustration with an energy crisis that leaves most of the country without power for much of the day. With temperatures hovering in the triple digits Fahrenheit, foreign alliances may be the least of his concerns if there's no electricity soon.

The United States is turning its attention elsewhere, meaning Sharif can conduct business without too much worry of immediate U.S. repercussions. Without cash to pay the bills, Pakistan's energy production operates at about 50 percent capacity during the hot summer months. Iran, however, said it would help finance the construction of a natural gas pipeline from the South Pars field in the Persian Gulf, one of the largest in the world.

Sharif's administration said energy was at the top of its 100-day agenda. The federal planning minister said that agenda includes the Iranian pipeline, once dubbed the Peace Pipeline, U.S. foreign policy concerns be damned.

"We will continue the work at the gas pipeline because such a vital project cannot be set aside in hard times like the present," he said.

^^RH: "Have you heard the proverb "shoemaker's children have no shoes" ?"----

If New Delhi can get its hands on the Switch for our electricity grid, they will more than happily allow half of India to sit in the dark. What they want more than anything else is CONTROL over us. This is why:1) They keep offering diesel, gasoline etcetera from their refineries.2) They keep offering electricity from their power plants.

If we become dependent on India for purchasing essential fuel or electricity, then they will develop the 'doctrine of selective sanctions' to squeeze us at every step. This is textbook operation from Baniya 101.

If we become dependent on India for purchasing essential fuel or electricity, then they will develop the 'doctrine of selective sanctions' to squeeze us at every step. This is textbook operation from Baniya 101.

Yup which is why we have more of less adhered to the IWT despite 4 wars!

Not only does there seem to be no early end in sight to the power crisis, but Pakistan’s energy woes will also be a huge drag on economic growth, reveals the Pakistan Economic Survey 2012-13 launched here on Tuesday.“The critical issue is that, according to National Transmission and Despatch Company (NTDC), the annual electricity demand growth rate is forecasted to hover around 5 to 6 per cent over the next ten years. With the current position of [power generation] expansion, it seems that the crisis will not [soon] be over, which in turn will affect economic growth,” the survey revealed.As of March 2013, the number of consumers has increased to 21.704 million, although the consumption pattern has remained more or less the same in 2012-13, with domestic consumers standing at 43 per cent, industrial consumers at 26 per cent and agricultural consumers at about 11 per cent.--------The survey stated that Pakistan’s power sector is heavily dependent on gas supplies, and the reduction of this supply, due to misallocation and low growth, has crippled its performance.There was negative growth in the consumption of gas during Jul-March 2012-13. The analysis of the sectoral consumption indicates that during July-March 2012-13, the highest share in gas consumption remained in the power sector (27.5 %) followed by industry (22.6 %).As the government accorded a priority to providing gas to households, the share of households in gas consumption remained 23.2 per cent. However, the trend of providing gas to the power sector is declining since 2005-06 except in 2012, where there was a growth of 6 per cent. Transport is the other significant sector that posted a positive growth in gas consumption of 5.3 per cent during 2011-12, however, during July-March 2012-13 a negative growth of 16 per cent has been witnessed in this sector.At 16 per cent, the share of the fertilizer industry still remains significant but there was negative growth of 7 per cent in 2012, as compared to the previous year.Increased gas demand and investment on the cardsIt is expected that gas will be supplied to approximately 39,000 new consumers and about 350 new towns/villages will be connected to the gas network during the fiscal year 2013-14. Gas utility companies have planned to invest Rs17437 million on transmission projects, Rs27,265 million on distribution projects and Rs11,165 million on other projects, bringing the total investment of Rs. 55,867 million during the fiscal year 2013-14....

Here's a report that shows India too has a fuel crisis and debt issues in the power sector:

Fuel supply risks and precarious financial health of electricity distribution companies continue to pose challenges for the power sector, whose slow progress could impact the country’s economic growth, a report said today.

India Ratings & Research, part of global major Fitch Group, also cautioned that expected investments worth Rs 1,75,000 crore in various power projects could turn into non— performing assets unless fuel issues are resolved.

For every one per cent increase in Gross Domestic Product (GDP), the power generation need to increase by one per cent.

Otherwise, there would be inadequate electricity supply that can impact not just the power sector but also other industries.

“The progress of reforms in the power sector is happening at a slow pace. The sector is expected to suffer this year (also) and investors are not likely to be enthused to put money into the sector,” Garg noted.

Indian economy is projected to grow at a slower pace, in the range of 5.7—5.9 per cent, this fiscal.

India, which has an installed power generation capacity of over 2,00,000 MW, expects to add about 88,000 MW in the current Five—Year Plan ending March 2017.

The report ‘2013 Outlook: Indian Power’, co—authored by Garg and released on Wednesday, said that fuel risks —— coal and gas —— along with uncertainties about financial viability of distribution companies (discoms) remain major issues.

Huge tariff hikes — required to revive discoms — can’t be expected this year as many states have already increased them significantly in recent times, Garg said. Tamil Nadu has raised tariffs by as much as 27 per cent.

Coal India, the largest supplier to power plants, has not inked any Fuel Supply Agreements (FSAs) since FY 2009.

The report said: “The 114 FSAs for plants commissioned post FY09 and likely to be commissioned till FY15 have a total cumulative capacity of 51,000 MW and with letters of assurance quantity of 216 million metric tonnes (mMT).

“Assuming only 65 per cent to be met through domestic coal, Coal India will have to increase its dispatch to the power sector to 436 mMT by FY15 (a Compound Annual Growth Rate of 12 per cent), which looks difficult.”

The total investment required for 51,000 MW, including debt and equity, would be around Rs 2,75,000 crore. With fuel risks, there is a possibility of debt portion — of around Rs 1,75,000 crore — becoming non—performing assets for banks and financial institutions, Garg noted.

Here's a McClatchy report on Sharif allocating no money to Iran-Pakistan gas pipeline:

Pakistan’s newly elected government Wednesday unveiled its first budget, which gave the go-ahead for buying two new nuclear power plants from China but made no allocation for a long-proposed natural gas pipeline from Iran that had sparked complaints from the United States.

In not budgeting for the Iranian pipeline, agreed to by his predecessor in February, Prime Minister Nawaz Sharif tactfully sidestepped a potential diplomatic clash with the United States, which had warned that the pipeline, if it were ever built, could lead to sanctions on Pakistan. The deal also was criticized as a trap for the new administration by Sharif’s brother and de facto deputy, Shahbaz Sharif, the chief minister of Punjab province.

The $35.5 billion budget, which was presented to Parliament by the new minister for finance, Ishaq Dar, suggested that the new government would follow through on Sharif’s plan to resolve the country’s power shortages that Dar said had cut the country’s economic growth by 2 percent in the outgoing fiscal year, which ends June 30.

Dar’s budget would switch Pakistan’s power generation plants from expensive imported fuel oil and gas to much cheaper coal sourced partly from undeveloped reserves in Pakistan’s southern Sindh province. The rest probably would come from huge mines in India, Pakistan’s traditional foe, with which it has fought two wars since both gained independence from Britain in 1947.

The South Asian neighbors opened talks Tuesday about the planned import of Indian electricity via cross-border cables near the eastern Pakistani city of Lahore.

The budget also sets aside about $430 million for new nuclear power plants from China, a project that the United States and India have both objected to at meetings of the Nuclear Supplier Group, one of the international groups that attempts to prevent nuclear proliferation. But Pakistan insists that the plants are unconnected to the country’s nuclear weapons program and are regularly inspected by the International Atomic Energy Agency. Pakistan possesses between 80 and 120 nuclear weapons, according to estimates by Western analysts.

A Cabinet minister, speaking to McClatchy on condition of anonymity because he was not authorized to discuss the project with a reporter, said the Iranian gas pipeline hadn’t been altogether dropped, largely because that would invoke a penalty payment to Iran. Instead, he said, Pakistan’s new government would procrastinate by trying to haggle lower prices from Tehran, based on the comparison with coal.

Analysts also said Sharif could forgo the Iranian pipeline because of the prime minister’s good relations with Saudi Arabia. Sharif spent six years in exile in the Persian Gulf kingdom as part of a deal for his release from jail in Pakistan negotiated by the Saudi royal family, after he was overthrown in a military coup staged by Gen. Pervez Musharraf in October 1999....

Seems like we are falling yet again in the Oil for loyalty to Saudi influence supported by the US. The only issue is that the Saudis will also support the Wahabi extremists and will expect Pakistani look away on those activities. The break the Pakistani get in return will be terms for the payment of the the Oil - i.e. there will be no FREE Oil - but the pro-Saudi propaganda machinery will promote it as if the Saudis are feeding the Pakistani people.

Umair: "Seems like we are falling yet again in the Oil for loyalty to Saudi influence supported by the US. The only issue is that the Saudis will also support the Wahabi extremists and will expect Pakistani look away on those activities....."

Pakistan's best interest is not in defying Saudis and Americans to buy expensive Iranian gas ($11-12 per mmBTU) and end up with crippling sanctions which could be much worse than its current energy crisis. Its best interests will be served by developing its own cheap domestic shale gas ($4 per mmBTU) on an accelerated schedule with Saudi investment and US tech know-how. If the Americans and the Saudis refuse to help, then Pakistan will have a stronger case to go with the Iran gas option.

Do Indians show China vs japan vs USA vs EU type stats at the drop of a hat?

On a per capita basis what is the baseload power availability(Coal/Gas hyro nuclear) in Pakistan?

Oil fired plants are 'peaking plants' they are there for the few hours a day when demand dramatically increases only grossly incompetent governments will build them for baseload power.Even arabs with all their oil don't use it for baseload power!

Pakistan is to borrow more than $5bn to pay off the country’s outstanding electricity bill amid rising anger over power cuts that have exploded into violence in some cities.Parts of Pakistan have remained without electricity for up to 20 hours a day this summer. According to the finance ministry, the shortages have caused annual losses equivalent to 2 per cent of GDP.

The move, by the new government of Prime Minister Nawaz Sharif, constitutes a gamble. The administration is looking for a quick-fix solution to ease the power crisis but some argue that by taking on more borrowing it will only lead to further debt problems in the longer term.The government is to raise $5bn through the sale of government bonds to pay off the debt owed to the country’s private electricity producers as well as fuel suppliers.“We have to take our country out of the mess we are in” said Ishaq Dar, the finance minister, on Thursday announcing details of the scheme. “Clearing this backlog is our top priority”.The government has said it will clear the debts by August this year in what is the largest such single payment to tackle serious shortages of electricity in the country’s history.Though many analysts support Mr Sharif’s government for moving to settle the outstanding bill, some are more cautious. “The government really has to reform the electricity sector where the problems are huge” said Sakib Sherani, a prominent economist. “Without reforming the sector, this decision (settling the electricity bill) could be a gamble”.-------

While the upcoming payments may clear the backlog of dues that have forced some electricity producers to scale down their operations, analysts warned that the power shortages were a consequence of a poorly run government-owned electricity transmission system.In some areas of Pakistan, between 30 to 40 per cent of electricity gets lost before it reaches end users. This is mainly due to inefficient transmission systems and theft involving corrupt officials who team up with private consumers to supply connections that are never billed.“The financial settlement will help to tackle the immediate crisis. Once the payments are made, we should have more electricity in the system,” said Shuja Rizvi of Al-Hoqani securities stock brokers in Karachi. “The danger is, there must be very aggressive reforms to tackle the [power] losses as the root cause. Otherwise, this problem will return to haunt us”.

Despite pressure from the United States, the government has officially announced in its Annual Plan 2013-14 that it will implement the Iran-Pakistan gas pipeline project, targeting the first flow of gas in December 2014.According to the energy strategy unveiled by the Pakistan Muslim League-Nawaz government in the Annual Plan 2013-14 released on Wednesday, the project’s cost has been reduced to $1.25 billion against earlier estimates of $1.5 billion.Under the IP gas pipeline project, Pakistan will import 750 mmcfd of gas to generate 4,000 Megawatts of power to overcome the crippling power crisis.According to the plan, the government plans to appoint a third party inspection agency for the IP project in June-July 2013. It has also planned to procure equipment and material to begin construction in the financial year 2013-14. The government has also targeted to complete the construction of Pakistan’s portion of the pipeline in the new fiscal year, at which time the first gas flows are expected to begin.

At the same time, Prime Minister Nawaz Sharif’s government is also planning on committing to the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline project. Under this project, about 3.2 billion cubic feet per day of gas will flow through the 1,680 kilometre-long pipeline. The estimated cost of the pipeline is about $7.6 billion.During the fiscal year 2012-13, which will end by the end of this month, the expected local production of oil was 74,000 barrels per day against a target of 69,000 barrels per day, exceeding the target by 5,000 barrels per day.However, gas production fell short of the target, as the domestic gas production was expected to be 4,200 mmcfd against the 4,791 mmcfd target.A total of only 83 wells (30 exploratory and 53 appraisal/development wells) were expected to be drilled against a target of 100 wells.

^^RH: "The whole South Asia region has lower per capita energy consumption than sub-Sahara Africa in terms Kg of oil equivalents"----

The topic of this blog article was ELECTRICITY.

So with 95% of people connected to the grid, why are we STILL consuming less electricity per capita than sub-Saharan Africa, when large swathes of their population do not even have connections (e.g. Nigeria is 60% connected, Kenya is 65%)

Pakistan is at least 5,000MW short of what it is needs to support the country this summer, the Water and Power Development Authority (WAPDA) reported. On one day in May, the national power grid generated 9,200MW, 7,000MW short of demand, UPI reported.

The acute energy crisis has taken its toll on industry, agriculture and the job market, costing millions of Pakistanis their jobs over the past 10 years, according to economists.

"The energy crisis has reduced GDP growth by 2.5-3% [per year], and it directly affects the 2.5m new job seekers who enter the market every year," Dr. Ashfaq Hassan, an economist, told Central Asia Online, adding that millions of Pakistanis lost their jobs because of the crisis in the last decade.

Pakistani energy potentialIt is not a matter of lacking energy resources, but rather it is a matter of properly tapping into Pakistani potential, Hassan said.

The country has large potential for economic growth and employment if exploited carefully, he said.

Pakistan in a few years could overcome the energy crisis and massive unemployment, and the GDP growth would be higher if load shedding vanished, economist A. H. Nayyar said.

The country's power potential is 59,208MW for hydropower; 100,000MW for coal; 7,500MW for wind; 2,000MW for solar; and 25,031MW for thermal, WAPDA spokeswoman Farhat Jabeen told Central Asia Online.

Projects boost energy productionThe energy crisis seems to be worsening day by day, but the power generation projects are now increasing hope and the country's future is not as dark as it once seemed.

Several stakeholders are involved and the authorities are trying hard to contain the power shortage and load shedding in Pakistan, Jabeen said.

Construction is progressing on 17 small- to medium-size dams and other power-generating projects, and some of them should be ready within a few months, she said.

More than 400MW will be added to the national grid this month, and another 4,000MW in the next five years, she added.

Three dams are nearing completion and two others are scheduled to be finished in 2015, official records reveal.

The dam projects, for example, have directly employed 19,200 workers in the past five years, the WAPDA dams director said.

The energy development sector has provided more than 100,000 jobs in various projects over the past eight years, official records reveal.

Energy development projects are already denting the unemployment rate. There are also expectations that the increased employment will trickle down to industry and agriculture.

Development activities like those in the energy sector always have a positive effect on other areas of the economy, Nayyar said, noting more job opportunities will come to cement and other industries.

Alternative energy plans on tap, tooThe government is not only encouraging the dams as energy sources but also promoting solar, wind, nuclear and other means. It initiated projects in this direction as well.

The Alternative Energy Development Board initiated wind, solar and other projects that will add 500MW to the national grid within two years, Chief Executive Arif Alauddin told Central Asia Online.

But the potential for such projects is much greater as these sectors are attracting huge investment, he said.

Rather than a snapshot for a given year, it is better to look at many snapshots over a period of time to get a better perspective of issues like development. In other words, it is more important to look at a trend if there is one otherwise statistics can allow someone to make whatever point they wish to make.

Let us examine the data of per capita energy use in kg equivalent for the years 1981, 1991, 2001 and 2010 for Lower Middle Income countries of India, Pakistan & Philippines using World Bank data

Here is an interesting explanation of why India has only 75% connection-rate when we have 91% connectivity....

QUOTE: "...its priority should have been to increase the energy resource and allocating it to the production sector. That needs to prioritise the allocation of gas and electricity. In India, according to the World Bank, 306.2 million people do not have electricity. According to my findings, New Delhi has deliberately taken this step. This energy is diverted to the industrial sector; with economic improvement, the conditions will improve gradually. Can the Pakistani leadership too take such a bold decision?"

A lot and I mean a lot of Indian power capacity is Captive power by the industry a bit of which is given to the SEB with the relevant PPA.10000MW power is added every year in India well over 6000MW is captive...

Prime Minister Muhammad Nawaz Sharif has directed the concerned authorities to speed up the pace of work on Neelum-Jhelum Hydro Power Project to save the people from load shedding.

He stated this while inspecting various parts of the Neelum-Jhelum Hydel Power Project on Wednesday.He was apprised that the Rs274.882 billion Neelum-Jehlum power project would have the capacity of generating 969 MW power.The Power House of the project is located in the Chattar Kalass which is 22 kms south of Muzaffarabad. Installed capacity of the project is 969 MW comprising four units of 240 MW each.The Prime Minister was given a briefing on the project during his visit to the site of Neelum-Jehlum hydro Power Project. The original cost of the project was Rs130 billion but the revised PC-1 cost of the project was put at Rs274.882 billion as it has escalated due to change in design and machinery requirement owing to the earthquake of 2005.--------Neelum Jehlum Hydro electric Project is a mega project of immense national importance. It is in the vicinity of Muzaffarabad (AJ&K) and envisages the diversion of Neelum river water through a tunnel and after producing power‚ out-falling into Jehlum river.It will also help reduce the gap between demand and supply of power in the country.The newly-elected government of Pakistan Muslim League-N is paying special attention to development of infrastructure projects in the country and the allocation of Rs. 1.1 trillion in Public Sector Project Programme (PSDP) in the FY 2013-14 is a clear manifestation of government's commitment on this count.

If the government is able to strike the right balance between upfront 3G licence fees and the industry’s capacity to invest in infrastructure, Pakistan is looking at potential investment of $5-10 billion over the next five to eight years from the five players already operating in the country.These are the words of Jon Fredrik Baksaas, CEO of the Telenor Group. He also added that his company was looking at a potential investment of anywhere up to $1 billion over the next two to three years in Pakistan, including the upfront 3G licence fees. “Telenor is already in the process of a network swap in Pakistan. We are upgrading our base stations, which will then be ready to receive 3G equipment. We are about 50% done and should be finished by the end of this calendar year,” he said.Baksaas was speaking to a group of telecom journalists from Pakistan at the headquarters of the Telenor Group in Oslo. Contrary to common belief, he insisted that Pakistan was not really late in upgrading to 3G. “Pakistan is not necessarily late on 3G, but it is about time to get it done.”He believes that the Pakistani market is now mature enough, with enough mobile penetration, for the demand for 3G to be building up to a healthy level. “On paper, there is about 70% mobile penetration in Pakistan, but probably a bit less in reality, since many people have more than one SIM,” he observed.This indicates that there is a lot of pent-up demand, which means better-than-average growth rates in the initial years of 3G, as was the case in Thailand when it finally jumped on the 3G bandwagon.He also hoped that now that Pakistan was finally gearing up, it would be smarter than India in launching 3G. “When India had their 3G auctions, the government was too concerned with how much money they could pocket upfront and did not focus on how much financial resources to leave behind in the industry for the infrastructure to be built up. My advice to the Government of Pakistan would be to think of the balance of upfront auction fees against the ability of the companies to build quality networks in the country.”Baksaas said this would be great for the country. “Through investment, you create profitable companies which create employment and can then be taxed. I believe that if you can raise internet penetration in a country by 10%, you can raise the GDP by about 1.5 basis points.”He also felt that a countrywide rollout of 3G, and subsequently 4G, was very important, instead of just in major cities. “The benefits of 3G to the countryside of Pakistan will be relatively higher than 3G in the city, when you think of the daily lives of individuals and services like health, education, financial services, etc.”He, however, did not feel that new players would be able to capitalise on the opportunity for 3G. “It has been proven difficult for newcomers to get into 3G or 4G if they don’t already have an existing network. We believe telecom is an evolution that starts with voice and sms.” When asked about Telenor’s readiness, he had just this to say: “We are ready and we are willing and we have the capacities and the competencies to build 3G in Pakistan.”Baksaas was, however, concerned with regular cellular shutdowns in the country, as he felt that this was not a practical or efficient solution and perhaps needed to be better thought out.------He insisted that so far growth and penetration in Pakistan has been much better than regional peers like India, because of the way the local industry is structured and regulated. In India, he said, the focus is on intense competition in the cities alone, because of which rural areas are still not covered. In Pakistan, geographical coverage is excellent in comparison...

Pakistan has crossed a historical milestone. Elections were held on time, and for the first time in its 66-year history, a democratically elected government completed its term and handed over power to a new one. At the same time, the elections recorded a voter turnout unprecedented in recent years.Much of this renewed political interest has been driven by Pakistan’s telecommunications revolution. Over 50 million voters verified their polling stations through their mobile phones and the elections were tweeted, blogged, and plastered across Facebook. In fact, the way I see it, the elections presented a major victory not only for Pakistan, but also placed a massive feather in the collective caps of telecom companies.

The Information Communication Technology (ICT) industry in Pakistan has registered a prolific boom in the last few years. With affordable pricing and 122 million connections showing mobile penetration at an all-time high, Pakistanis are amongst the highest SMS users in the world – the average Pakistani sends up to 178 text messages in a month.And recent months have seen the launch of mobile financial services by various players, with transactions worth Rs3.76 billion via online banking already taken place.Internet and broadband penetration is at a similar peak. According to World Bank statistics, by July 2012, Pakistan internet users showed a double-digit growth in the past five years and the Internet Service Providers Association of Pakistan (Ispak) estimates that internet users have reached 25 million thanks to broadband and mobile phone operators.Moreover, thanks to large organisations such as PTCL and Wateen Telecom, over 250 towns and cities across the country are now connected through an extensive fibre optic network.Universal Services FundThe government also intends to use approximately $700 million available with the Universal Services Fund (USF) to further develop the infrastructure and network that has already been put in place. The USF’s aim to “improve the working of the Universal Services Fund (USF) and utilise its resources to bridge the rural-urban digital divide and establish WiFi hotspots” is certainly a welcome one.---------Smart gridsThe auction of licences itself will give an impetus to the economy and provide the government with FDI. However, the regulatory body will need to rely on more than just consumer uptake in order to achieve the scale necessary for sustaining growth. This means formulating policies that encourage the uptake of data services by vertical industries, for example solutions for smart grids.Indeed, smart grids should be a top priority for the new government – not only will they enable growth and scalability within the ICT sector, they will also provide significant value for the power and energy sectors.Currently, there are several pilot projects under way using cellular technology, however, according to industry leaders, cellular solutions for smart grids are not scalable.Moreover, utility companies require constant data streams on their networks for telemetry, oscillography, usage and meta-data. Data usage is rapidly increasing and demand is likely to increase once 3G services are introduced.Telecom operators, on whom electricity distribution companies currently rely, will likely be in a challenging position in the next few years as demand on their networks grows for ambient video and other data-heavy services.

Here's a Daily Times report on Pakistan settling "circular debt" owed to IPPs:

In order to eliminate circular debt, the government has released Rs 362 billion to the Independent Power Producers (IPPs), out of which four IPPs announced that they have received a total sum of Rs 116.826 billion as a part of their overdue receivables, according to the Karachi Stock Exchange (KSE) notice released on Tuesday. Five IPPs out of 19 others, in Memorandums of Understanding (MoUs) signed between government and IPPs, including Hub Power Company Limited (Hubco), Nishat Chunian Power Limited (NCPL), PakGen Power Limited (PKGP), Kohinoor Energy Limited (KEL) and Nishat Power Limited (NPL) have announced officially in notices to all bourses of the country that they have received around Rs 116.826 billion from Central Power Purchasing Agency (CPPA), Water and Power Development Authority (WAPDA) and National Transmission and Despatch Company (NTDC).Hubco remained prime beneficiary as the company stated in a letter to the KSE that the company has received overdue amounting to Rs 75 billion out of Rs 83.2 billion (overdue as of May 31, 2013) for Hubco and Rs 17.4 billion for Narowal Plant from WAPDA and NTDC, bringing the total to Rs 92.4 billion.Hubco announced that the company has paid Rs 55.8 billion to Pakistan State Oil (PSO) as agreed under the settlement arrangement.Hubco has entered into three MoUs with the government as required by them for the settlement of agreeing to convert Hub plant from oil to coal, extend the credit period for its Narowal Plant from 30 days to 60 days and to endeavour to operate the plants at full capacity. Under the MoUs, IPPs also agreed to achieve their maximum generation capacity and provide 1,500 megawatts (MW) to 1,700 MW to the national grid before Ramazan, four IPPs including Hubco, Lalpir, Pakgen and Saba Plant, have agreed on conversion to coal-based power generation within 18 months, extend credit period from 45 days to 60 days and reduce interest rate on late payments by public sector power companies.Similarly, NCPL announced that the company has received overdue receivables amounting to Rs 6.86 billion from CPPA without any reduction in existing delay mark-up rate of existing 4.5 percent to 2.5 percent as against expected cut of 2.0 percent from 4.0 percent to 4.5 percent.Likewise, PKGP also informed the KSE that the company has received overdue receivables amounting to Rs 6.982 billion from CPPA at existing delay mark-up rate.Also, KEL announced in a letter to KSE that the company has received overdue receivables amounting to Rs 3.504 billion from WAPDA.Muhammad Affan Ismail of BMA Research told this scribe that the fund injections (cash or otherwise) are a short-term solution and have no long-term implications on operational factors or returns to investors. Best would be to recall the Rs 82 billion Tem Finance Certificates (TFCs) issued last year by the government in order to help solve the power crisis, he added. NPL has announced that it has received overdue amounting to Rs 7.080 billion. ---Naveed Tehsin of JS Research believes that PSO stands out as a key beneficiary from the retirement of the circular debt as its receivables and payables to local refineries have sharply declined to Rs 79 billion (down 54 percent) and Rs 9 billion (down 66 percent), respectively. Tehsin expected that receivables would further decline by Rs 48 billion after the issuance of Pakistan Investment Bonds to PSO.

A new World Bank study says Pakistan has demonstrated that it can reduce poverty even at relatively low rates of growth of 3.2 to 4.5 per cent but not at growth of GDP per capita of 1pc, noting that it is struggling to sustain that growth.

“International comparisons suggest that Pakistan has been a good performer in turning growth into poverty reduction. Countries that are more successful in reducing poverty tend to be better at generating sustained growth, however the issue for Pakistan will thus be sustaining growth,” according to World Bank policy note on poverty in Pakistan.

The observation that Pakistan is successful in reducing poverty when GDP grows but cannot sustain that growth has two important policy implications. With more growth interruptions, an adequate social protection system becomes more important.

The second implication is that a renewed effort to address the problem that work against sustained growth would be well justified for faster poverty reduction.

This effort should lead to policy priorities for poverty reduction different from those in countries better able to sustain growth but unable to convert that growth into rapid poverty reduction, it says.

The poor are vulnerable to shocks — be they of natural disasters, health or macro policy. An adequate system would ensure that when shocks hit, the poor and vulnerable can still maintain the investments they need to increase their incomes and their children’s welfare.

Describing safety net programme like Benazir Income Support Programme as no substitute for sustained growth, the study says due to stop-go growth and too many natural disasters, Pakistan has to ensure a strong safety net programme as part of an overall poverty reduction strategy.

The study estimates that in Punjab, the largest province, where it says data appears more reliable, poverty has fallen considerably from 33.5pc in 2001-02 to 16.4pc in 2007-08, after adjusting for higher food prices.

This improvement was driven largely by increasing returns in the non-farm sector, in both urban and rural areas.

Over the period, the growth of per capita consumption of the bottom 40pc of Punjab’s population exceeded GDP per capita growth. Subsequently, over 2007-08, 2010-11, per capita real consumption growth in Punjab was stagnant, and the equality of opportunity for primary education completion rates seemed to improve but alongside a slowdown in the rate of improvement in indicators for water and sanitation and for primary enrolment.

The report says that the last three years have seen sizeable differences in the improving social indicators. Sindh has been lagging in its primary completion rates, and Khyber-Pakhtunkhwa has been lagging in coverage of improved sanitation.

According to the report, opportunity is growing in both urban and rural areas for education and sanitation, which is a very positive sign. Urban children have more absolute opportunity than rural children, but the rate of growth in rural areas is growing faster.

Here's a pv magazine report of a local NGO working to light up Pakistani villagers' homes:

Working with local and international partners like Coca-Cola, China Mobile's Zong, the Imran Khan Foundation and Engro Corporation, Pakistan's Buksh Foundation has set a goal of illuminating 4,000 off-grid villages by 2017.

Pakistani village Chak 113The village of Chak 113, in Punjab's Sahiwal District, installs its new lantern charging station.Buksh FoundationAs part of a pilot project to increase the use of solar power, the Lahore-based microfinance institute Buksh Foundation and the Energy and Resources Institute (TERI) in India, working with national and international partners, have electrified 72 off-grid villages in Pakistan's Punjab province.

The Buksh Foundation, launched in 2009 by Pakistani retail giant Buksh Group, has sought to increase financial inclusion for rural and peri-urban population.

The organization has launched a unique solar energy access model, Lighting a Million Lives, which aims to provide energy access to rural un-electrified areas of Pakistan.

"Under this project, 72 villages in the districts of Sahiwal, Mianwali,Lodhran, Dera Ghazi Khan, Dera Ismail Khan, Bahawalpur and Chiniot have already been electrified, with 70 more in the pipeline for this month, further reaching out into Mardan, Khushab, Gujrat, Kasur and Bahawalnagar in a period of only six month," Anam Elahi, the Buksh Foundation's business development manager and head of the Lighting a Million Lives project, told pv magazine.

The project has already impacted some 25,000 people and the Buksh Foundation is planning to light a total of 4,000 Pakistani villages, directly helping a million individuals, in the next three years. Recently scheduled projects include electrifying the villages in the northwestern province of Khyber Pakhtunkhwa.

"The project with its multifold benefit model, has not only helped in providing a sustainable energy alternative, but has also encouraged female empowerment, increased economic capacity of the rural areas, created literacy about the needs for environmental friendly energy alternatives and the benefits they provide," said Buksh Foundation CEO Fiza Farhan.

The initiative seeks to empower females in rural communities by putting them in charge of photovoltaic charging stations, which are used to charge lanterns during the day. The women then either sell or rent the lanterns to villages for PKR 4 (€0.03) a day, providing a much cheaper alternative to high-priced kerosene traditionally used for lighting.

Each solar lantern replaces about 500-600 liters of kerosene during its 10-year lifespan, mitigating about 1.5 tonnes of CO2, according to the Buksh Foundation.

The organization said that about 43% of the population of Pakistan lives without access to electricity, of which 70% live in rural areas in 50,000 villages, completely detached from the national electricity grid. By 2015, the figure is expected to climb to 46% as the energy deficit worsens; by 2025, it will rise to 64%, with 187 million people having no access to the power grid.

By reaching its goal of providing a million lanterns to people the Foundation said it could reduce 1.5 million tons of CO2, save around PKR 25 billion (€188 million) and reduce oil imports by 6% a year....

To enhance access to non-solid fuels like gas, Pak televangelist Aamir Liaqat Husain's foundation has launched “Choolah Ghar” this year, where those deprived and unfortunate people are being facilitated with Free Gas, who does not have Gas facility. Except this, the Mehmooda Sultana Foundation, named after Aamir Liaquat's mother, is supplying food packs to poor people in different hospitals on daily basis.

ISLAMABAD, Dec 3: About 1.3 billion people in the world are living without electricity; two-thirds of them being in 10 countries and four of them, including Pakistan, in the Asia Pacific region, says a report of the United Nations.

According to the Statistical Yearbook for Asia and the Pacific-2013 released by a UN commission on Tuesday, an estimated 60 per cent of capacity-addition efforts in future will be focused on mini-grids and off-grid connections in which renewable energy sources will play a vital role.

In the generation of electricity from renewable sources, the Asian and Pacific region led the world in 2010. But this amounted to only 15.8 per cent of the region’s total electricity, which is below the world average of 19.4 per cent.

With less than 400 kilowatt-hours per capita, the annual household electricity consumption in the region is the second lowest among the world’s regions, after Africa where it is 200kwh.

About 2.6bn people in the world and 1.8bn in the region use solid fuels for cooking. The WHO estimates that more than 1.45 million people die prematurely each year from indoor air pollution caused by burning solid fuels with insufficient ventilation.

Women’s economic empowerment

The report says that despite its economic growth, the region lags behind in economic empowerment of women. It calls for targeted policy measures to facilitate women’s economic empowerment.

Women still bear the burden of unremunerated productive work, shouldering the major share of household management and care-giving responsibilities.

The report says that in Pakistan women spend 5.5 hours a day on housework and 1.2 hours on childcare whereas men spend 2.5 hours on housework and 0.9 hours on childcare.

It also says that women are overrepresented in sectors and positions that are vulnerable, poorly paid and less secure. For instance, 42 per cent of working women/girls belonged to agriculture sector in 2012 compared with 36.0 per cent of male workers.

Nabela Zainab no longer chokes and coughs when she cooks a meal, thanks to the new biogas-fueled two-burner stove in her kitchen.

Zainab, 38, from Faisalabad, a town 360 kilometers from the Pakistani capital of Islamabad, is among the beneficiaries of a flagship pilot biogas project to free poor households and farmers of their dependence on wood, cattle dung and diesel fuel for cooking needs and running irrigation pumps.

She got the biogas unit, worth 400 dollars, at a 50 percent subsidised rate from the NGO Rural Support Programme Network under the latter’s five-year Pakistan Domestic Biogas Programme (PDBP).

In the past, Zainab had to collect wood from a distant forest three times a week and carry it home balanced on her head.

“Getting rid of that routine is a life-changing experience,” she told IPS.

The four-cubic-meter biogas plant requires the dung of three buffalos every day to meet the energy needs of a four-member family, including cooking, heating, washing and bathing for 24 hours.

It saves nearly 160 kg of fuelwood a day, worth 20 to 25 dollars every month for a four-member family.

The wife of a smallholder vegetable farmer, Zainab says she has suffered from a cough and sore eyes for the last 20 years. “We have no access to piped natural gas in our village. The rising cost of liquefied petroleum gas (LPG) was not feasible either for us poor. However, we had no choice but to continue burning buffalo dung cakes or fuelwood,” she said.

Last January, cattle farmer Amir Nawaz installed a biogas plant of eight-cubic-meter capacity at a cost of 700 dollars under the PDBP. He got subsidy of nearly 300 dollars.

“I am now saving nearly 60 dollars a month that I used to spend on LPG,” he told IPS.

His plant is fueled by the dung of his six buffalos — enough to meet household gas needs for cooking and heating.

Nawaz also uses biogas to power wall-mounted lamps in his house at night, saving another 15 dollars a month.

“Above all, this has helped our children do schoolwork and for me to finish up the household chores in the evening hours,” Nawaz’s wife, Shaista Bano, said with a smile.

As many as 5,360 biogas plants of varying sizes have been installed in 12 districts of Punjab province over five years (2009-2015), ridding nearly 43,000 people of exposure to smoke from wood and kerosene.

Nearby, 500 large biogas plants of the 25-cubic-meter capacity each have also been introduced in all 12 districts of Punjab province under the PBDP, namely: Faisalabad, Sargodha, Khushab, Jhang, Chniot, Toba Tek Singh, Shekhapura, Gujranwala, Sahiwal, Pakpatan, Nankana Sahib and Okara.

Such plants provide gas for a family of 10 for cooking, heating and running irrigation pumps for six hours daily.

Rab Nawaz bought one of these large plants for 1,700 dollars. PBDP provided him a subsidy of 400 dollars as part of its biogas promotion in the area.

“I use the dung of 18 buffalos to produce nearly 40 cubic meters of gas every day to run my diesel-turned-biogas-run irrigation pump for six hours and cooking stove for three times a day,” he told IPS, while shoveling out his cattle pen in Sargodha.

The father of three says that after eliminating diesel — which is damaging to the environment and health, as well as expensive — he saves 10-12 dollars daily.

As a part of sustainability of the biogas programme, 50 local biogas construction companies have been set up. International technical experts trained nearly 450 people in construction, maintenance and repair of the biogas units.

Initiated in 2009 by the non-governmental organization National Rural Support Programme – Pakistan (NRSP-Pakistan), PBDP was financed by the Netherlands Embassy in Pakistan and technical support was extended by Winrock International and SNV (Netherlands-based nongovernmental development organisations).

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I am the Founder and President of PakAlumni Worldwide, a global social network for Pakistanis, South Asians and their friends. I also served as Chairman of the NEDians Convention 2007. In addition to being a South Asia watcher, an investor, business consultant and avid follower of the world financial markets, I have more than 25 years experience in the hi-tech industry. I have been on the faculties of Rutgers University and NED Engineering University and cofounded two high-tech startups, Cautella, Inc. and DynArray Corp and managed multi-million dollar P&Ls. I am a pioneer of the PC and mobile businesses and I have held senior management positions in hardware and software development of Intel’s microprocessor product line from 8086 to Pentium processors. My experience includes senior roles in marketing, engineering and business management. I was recognized as “Person of the Year” by PC Magazine for my contribution to 80386 program. I have an MS degree in Electrical engineering from the New Jersey Institute of Technology.
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